Alibaba logs best rally in five weeks on SoftBank statement while Tesla rival Xpeng soars on Stock Connect inclusion

Tech Index surged by the most in about three weeks on Alibaba’s rally after SoftBank rejected reports it could be selling its stake in e-commerce group

EV maker Xpeng jumped by record after the stock was added to the Southbound leg of the Stock Connect, giving trading access to mainland investors

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An elderly looks at the electronic screen displaying the Hang Seng Index stocks in Mong Kok, Hong Kong. Photo: Winson Wong

Published: 10:21am, 9 Feb 2022Updated: 4:48pm, 9 Feb 2022

Hong Kong stocks rose, halting a two-day slide as Alibaba Group Holding surged after SoftBank Group rejected reports it could be planning to cut its stake. Electric-car maker and Tesla challenger Xpeng jumped after its Stock Connect inclusion.

The Hang Seng Index advanced 2.1 per cent to 24,829.99 at the close of Wednesday trading. The Tech Index strengthened 3.7 per cent, the most in almost three weeks, while China’s Shanghai Composite Index gained 0.8 per cent.

Alibaba, the owner of this newspaper, jumped 6.8 per cent to HK$118.80, the most in five weeks. SoftBank Group, which owns about a quarter of the company, rejected reports it could be preparing to sell its stake in the Chinese e-commerce group.

The stock had lost more than 7 per cent in value this week after the Hangzhou-based company filed on February 4 to register 1 billion new American depositary shares, prompting analysts to speculate about SoftBank’s potential sale.

Alibaba holds a big sway on the local market as the stock carries more than 7 per cent weight in the benchmark and tech index.

“SoftBank’s clarification eased some market concerns,” said Mark Po, analyst at China Galaxy International Securities. “As a whole, the rebound might only be slight now but we may see some policy direction changing” to bring more impact to the market, he added.